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SwitzerlandThis is how the cantonal banks are ripping us off
High mortgage interest rate but zero interest on the account? The cantonal banks are recording record profits – and are now being heavily criticized.
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“Unfair” and “absurd”: While banks benefit from interest rate increases, private customers are left behind.
IMAGO/Michael Gstettenbauer
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Two thirds of the cantonal banks posted record profits in the first half of the year – due to the change in interest rates.
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While the mortgage has become much more expensive, the interest on savings deposits has remained almost at a low level.
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Now criticism is coming from all sides.
In the shadow of the Credit Suisse crisis, the cantonal banks made high profits in the first half of the year Sunday newspaper writes. Two-thirds of the 24 financial institutions posted record profits. Overall, the increase amounted to over 2 billion francs. In Zurich alone, ZKB, the largest cantonal bank, achieved an increase of 677 million. The reason for this is high margins in the interest business.
Since the end of the negative interest phase, banks have been able to charge higher interest rates for loans or mortgages. However, so far they have only raised the interest rates on savings deposits a little. “The banks are ripping off their customers,” says Sara Stalder, managing director of the Foundation for Consumer Protection, in the SonntagsZeitung. It is “unfair” when banks make “absurdly high profits” and at the same time refuse to cancel fees and increase interest rates.
Peter V. Kunz, professor of business law at the University of Bern, also believes that the cantonal banks “should be more accommodating to their customers when it comes to fees and interest” – especially the 15 cantonal banks that are organized as public institutions. “For them, maximizing profits should not be the priority.”
Dividend blessings for the cantons and higher bonuses
Some cantonal banks still do not offer any interest on payment accounts and the interest rates on savings accounts are also very modest, for example at ZKB at 0.75 percent. In return, the cantonal banks are currently charging just under 3 percent interest on ten-year mortgages.
From the perspective of the Association of Cantonal Banks, the interest rates are “in line with the market”. Since the interest rate turnaround happened so quickly, according to the ZKB, it would take time for the interest margins to gradually level off again.
In any case, the cantons can look forward to an increasing dividend from their banks and, according to the Sunday newspaper, it can also be assumed that one or two bonuses will increase. The ZKB only writes: “The bank will provide information in due course.”
2023-09-10 01:52:23
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